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Tag: p/e ratio

AP Photo/Mark Lennihan

Just How Overvalued are U.S. Stocks?

The average price-earnings ratio (PE) of US stocks is at 25.5, versus a 16.6 historical average. That means that the stock market is currently 51 percent overvalued. But the challenge for this simple formula is that with all-time low interest rates forcing down bond yields, we are in uncharted territory.

REUTERS/LUCAS JACKSON

NASDAQ Hits New High, After 15-Year Recovery

15 years after the Dot-Com Bubble burst, the Nasdaq Composite Index leapt by 20.89 points, or 0.4%, to close at 5056.06 on Thursday, a record high. The strength of the index is being driven by the Silicon Valley 150 tech companies that have provided the juice to lift the NASDAQ by 6.8%, despite U.S. stock performance trailing major world markets.